tokyo
10-26-2001, 07:34 PM
The introduction of third-generation mobile phone services earlier this month by NTT DoCoMo, the Japanese operator, was hailed as a world first, reinforcing Japan's image as a global leader in information technology.
Yet, a couple of hundred kilometres west across the East Sea, South Koreans have been quietly using 3G-style services for a year.
Walk down any street in central Seoul and you see people - mostly the young - tapping away at mobile phone keypads, surfing the wireless internet, playing online games, downloading music or sending video clips to friends. They are dubbed the Mobile Generation.
The services are not strictly third-generation because they use different technology to DoCoMo or the western operators' planned offerings. But South Korea's M-generation won't quibble about the difference.
More than 1m people have already signed-up to the 1X services, delivering to the three operators - SK Telecom, KTF and LG Telecom - fresh revenue streams that their straggling western counterparts can still only dream about.
When the more basic Wap (wireless application protocol) services are included, 75 per cent of South Korea's 28m mobile customers use wireless internet services, compared with the world average of 5 per cent.
South Korea's global lead in mobile telephony is no fluke. It reflects the country's growing status as a hotbed for information technology and online services. Whereas in many western countries the much-heralded new economy has so far proved a mirage, South Korea shows signs of building the real thing.
By almost any measure, South Korea has the most advanced internet market in the world. It has the highest penetration of home internet usage and Koreans stay connected longer than any others. In total, more than 20m of them - nearly half the population - use the web.
Increasingly, those domestic internet connections are high-speed, eliminating the frustrations of slow, unreliable dial-up connections that most western domestic users still suffer.
Already, 6m households have hooked-up to broadband networks delivered through cable or ADSL (upgraded telephone lines).
While in other countries market forces have been trusted with the task of taking the internet to the masses, President Kim Dae-Jung's administration played a central part in constructing the world's most comprehensive broadband network.
"The government's role was to build the infrastructure for the new economy. It was very liberal about using state money to connect schools and other public institutions to the internet," says Kang Yeoun-Sun, spokesperson for the ministry of finance.
"Korea was behind the developed world in the industrialisation process, so we were determined not to be left behind in the new economy," she says.
"The internet revolution has provided us with an opportunity to catch up and in some ways overtake the rest of the world."
The internet is helping South Korea make the final step from developing to developed country status and assists economic restructuring. As China and other emerging Asian economies create aggressive new competition for South Korean manufacturers, the Seoul government is anxious to shift away from heavy industry towards a more knowledge-based economy.
Lean and nimble technology companies are welcomed as agents of change in an economy hitherto dominated by lumbering industrial conglomerates - or chaebol.
"The IT revolution is part of the corporate and economic restructuring process. Before the 1997 financial crisis the respectable career path for graduates was to join a chaebol, says Ms Kang.
Internet service providers, e-commerce companies, software designers and the media and entertainments industries are all expanding rapidly, diversifying the IT sector beyond semi-conductor manufacture.
South Korea aims to become Asian leader in online gaming, an industry already worth Dollars 757m a year to the country, driven by a band of young software designers devising interactive games for the M-generation to play on their mobile phones, computers or tv sets.
Internet share dealing has been another success. "About 80 per cent of share trading in South Korea is carried out by retail investors and 50 per cent of that is done online," says Rhee Namuh, managing director of Samsung Securities.
"Nearly every person in Seoul can access the internet either at home or in libraries or community centres," says its mayor, Goh Kun.
However, not everything in South Korea's internet garden is rosy. Most of the country's IT and communications businesses have suffered sharp falls in share price this year, amid the sector's sharp global downturn.
Like elsewhere, companies are being squeezed at both ends with profits shrinking (or losses increasing) and funding drying up.
The problem is intensified in South Korea where the pool of venture capital is shallow and banks, tied-up with bad debts to the chaebol, are in no mood to lend.
"South Korea saw money vaporise following the dotcom crash like everywhere else in the world," says Dominic Barton, a director of McKinsey in Seoul.
"But at least it has managed to build a decent internet infrastructure ready for more business to be done."
read the rest of the FT survey http://surveys.ft.com/southkorea2001/
Yet, a couple of hundred kilometres west across the East Sea, South Koreans have been quietly using 3G-style services for a year.
Walk down any street in central Seoul and you see people - mostly the young - tapping away at mobile phone keypads, surfing the wireless internet, playing online games, downloading music or sending video clips to friends. They are dubbed the Mobile Generation.
The services are not strictly third-generation because they use different technology to DoCoMo or the western operators' planned offerings. But South Korea's M-generation won't quibble about the difference.
More than 1m people have already signed-up to the 1X services, delivering to the three operators - SK Telecom, KTF and LG Telecom - fresh revenue streams that their straggling western counterparts can still only dream about.
When the more basic Wap (wireless application protocol) services are included, 75 per cent of South Korea's 28m mobile customers use wireless internet services, compared with the world average of 5 per cent.
South Korea's global lead in mobile telephony is no fluke. It reflects the country's growing status as a hotbed for information technology and online services. Whereas in many western countries the much-heralded new economy has so far proved a mirage, South Korea shows signs of building the real thing.
By almost any measure, South Korea has the most advanced internet market in the world. It has the highest penetration of home internet usage and Koreans stay connected longer than any others. In total, more than 20m of them - nearly half the population - use the web.
Increasingly, those domestic internet connections are high-speed, eliminating the frustrations of slow, unreliable dial-up connections that most western domestic users still suffer.
Already, 6m households have hooked-up to broadband networks delivered through cable or ADSL (upgraded telephone lines).
While in other countries market forces have been trusted with the task of taking the internet to the masses, President Kim Dae-Jung's administration played a central part in constructing the world's most comprehensive broadband network.
"The government's role was to build the infrastructure for the new economy. It was very liberal about using state money to connect schools and other public institutions to the internet," says Kang Yeoun-Sun, spokesperson for the ministry of finance.
"Korea was behind the developed world in the industrialisation process, so we were determined not to be left behind in the new economy," she says.
"The internet revolution has provided us with an opportunity to catch up and in some ways overtake the rest of the world."
The internet is helping South Korea make the final step from developing to developed country status and assists economic restructuring. As China and other emerging Asian economies create aggressive new competition for South Korean manufacturers, the Seoul government is anxious to shift away from heavy industry towards a more knowledge-based economy.
Lean and nimble technology companies are welcomed as agents of change in an economy hitherto dominated by lumbering industrial conglomerates - or chaebol.
"The IT revolution is part of the corporate and economic restructuring process. Before the 1997 financial crisis the respectable career path for graduates was to join a chaebol, says Ms Kang.
Internet service providers, e-commerce companies, software designers and the media and entertainments industries are all expanding rapidly, diversifying the IT sector beyond semi-conductor manufacture.
South Korea aims to become Asian leader in online gaming, an industry already worth Dollars 757m a year to the country, driven by a band of young software designers devising interactive games for the M-generation to play on their mobile phones, computers or tv sets.
Internet share dealing has been another success. "About 80 per cent of share trading in South Korea is carried out by retail investors and 50 per cent of that is done online," says Rhee Namuh, managing director of Samsung Securities.
"Nearly every person in Seoul can access the internet either at home or in libraries or community centres," says its mayor, Goh Kun.
However, not everything in South Korea's internet garden is rosy. Most of the country's IT and communications businesses have suffered sharp falls in share price this year, amid the sector's sharp global downturn.
Like elsewhere, companies are being squeezed at both ends with profits shrinking (or losses increasing) and funding drying up.
The problem is intensified in South Korea where the pool of venture capital is shallow and banks, tied-up with bad debts to the chaebol, are in no mood to lend.
"South Korea saw money vaporise following the dotcom crash like everywhere else in the world," says Dominic Barton, a director of McKinsey in Seoul.
"But at least it has managed to build a decent internet infrastructure ready for more business to be done."
read the rest of the FT survey http://surveys.ft.com/southkorea2001/